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Can Theatre Really Work With The Secondary Market?


Before this year’s INTIX conference, INTIX posted a prediction piece about some of the trends and issues that would be facing the ticketing industry in the coming year.

Several of the trends deserve attention, but one that popped up in a manner that hasn’t typically shown up in this way was: the secondary market.

Brian Butler from Playhouse Theatre in Cleveland made a great point about the difference between broker and partner.

This is a subject that I think is likely to get a lot more play and attention over the next 18 months as sports teams consolidate their tickets into fewer hands on the secondary market and as organizations in all parts of the ticketing ecosystem continue to struggle with the challenge of maintaining and building sustainable customer bases.

But the bigger question Brian raises seems to be: what is the proper role of the secondary market in the arts?

Not is there a role at all. Because it would seem like no matter what anyone does, there is going to be a secondary market. The real idea is whether or not that secondary market ends up being a net positive or a net negative.

With an eye on the performing arts, here are a few ways that I think the secondary market can be partners to the primary and how they can create value for their primary market partners.


There is a certain dubious nature to the idea that distribution will solve all problems in selling tickets.

As great as wide distribution is, it is just as likely that we find a situation where all of this wide distribution leads to a situation where there is downward pressure on prices.

We see that at play a lot with sports tickets on the secondary market now.

In the case of the theatre though, one of the big challenges that many organizations face is actually raising awareness of their productions, shows, and performances.

Knowing how tight the budgets are for many organizations, competing in an advertising environment where there is just so much noise and so much demand for people’s attention is going to be really tough.

This never begins to look at the amount of investment and the headstart that the secondary market has in a lot of instances when it comes to advertising, branding, and awareness.

One of the things I admire most about the British ticket market is the open nature of how they sell tickets because it creates an environment where competition to sell leads to innovation and creativity.

In thinking through how the secondary market can partner with theatres, distribution is a jumping off point because, in the States, we don’t have the same open system of selling tickets.

This is where distribution through the secondary market can play a key role in innovating the way that organizations’ sell their shows, market themselves, and build a pipeline of future prospects.

How could this work?

There are a few ways:

One, you could mimic the way that the British system works and allocate seats to the secondary market with certain restrictions or qualifications in place.

Two, you could partner with the secondary market and have them take on a role much like an outsourced call center.

Three, you could sell a certain amount of inventory straight through to the secondary market, again with qualifications such as making sure that they purchase all shows in your season or something else.

Each of these points deserves a fully fleshed out post of their own, but the key here is that one of the key ways that the secondary market can help the primary market is by widening the scope of your distribution. And, the wise play is to be proactive in setting this relationship up.

Customer identification and acquisition: 

We have all heard the stories about how data is going to solve all of our problems.

Most of the time, we get data and we don’t know what to do with it because how we look at the data might not lead us to the insights we need, the data may not be relevant because we haven’t been using and activating it successfully, or some other reason.

One of the most underutilized aspects of data when it comes to tickets and events is using the most obvious data to take action.

Recently I was speaking with a broker about a relationship with a sports team and this concept came up straight away. The gist of it was, “We share data and we can even show them how to take action on this insight, but if nothing happens…it is a lost opportunity.”

That highlights another conversation I had with my friend Martin from ActivityStream because he showed me exactly how data-driven insights can lead to revenue in a number of different ways including the ability to easily know that someone has bought multiple tickets to a show’s run and being able to reach out to them, give them some sort of acknowledgment, or any number of personalized touches that cost little or nothing, but which do lead to greater customer identification and the ability to really speed up acquisition or expansion of the relationship.

Which brings us back to the way that the secondary market can offer value to the primary side in this area.

In almost every case, the primary market and the secondary market aren’t competing for customers.

In most cases, the person that is coming to the secondary market has a much different intention than the person coming to the secondary market.

What this means to the primary side is that the secondary market can identify ideal prospects for you and your season and productions.

This happens because most customers end up going to the secondary market in a reactionary way for a certain show or a certain need.

In the market on the primary side, the emphasis should be on generating demand and cultivating relationships in a proactive way.

This is like game theory where the finite game means that for me to win, you have to lose.

When a better game for everyone to play is the infinite game. Where we can all win.

This could play out by the secondary market actively sharing data and insights on the customers, giving you a better profile of the customer and enabling you to get a better insight into what kind of events, productions, and shows are going to appeal to this buyer.

It also allows you to recognize if someone makes a lot of their spending decisions for personal reasons, business reasons, a combination of reasons, or something else.

This type of information allows you to create better offerings, have better sales conversations, and, hopefully, generate more revenue.

The secondary market can take actions that might not be in the primary market’s best interests: 

When was the last time you saw a discount at the Apple Store?

I know they give an education discount, but I remember last Black Friday they didn’t offer a discount, only offered a gift with purchase.

Flip that around, when was the last time you paid full price at J Crew or Best Buy?

I’m guessing you had to think about that one for a bit.


Apple doesn’t discount and their premium brand holds its value.

J. Crew has destroyed its brand value because they went so heavy on discounts that people don’t feel an incentive to buy things until they are on sale. (Which is a theme we’ve seen across retail.)

That said, in the arts, how often do we see underperforming shows start throwing ridiculous discounts out into the world?

Here’s the scary fact, once you have opened the door on discounting, you are a discount brand for up to 7 years.

That’s not a guess, that’s science.

Take the opposite side of the equation as well.

There is a phenomenon that I have witnessed over and over again over the past 15 years that I’m going to call the Wakeman theory of ticket buying and it goes a little something like this:

The scarcer and higher a ticket price goes on the secondary market, the more people want it and are willing to pay, and the happier they are if they can get into the event. While if the primary side does the exact same thing, it often times leaves a customer feeling robbed.

As far as I can tell, there are two primary reasons for it:

  1. There is the bragging right of acting like you have a connection and the know-how to get into any event.
  2. Everyone loves to have an enemy, even if they don’t really have any animosity.

Think about the Heatles.

Remember how people hated the Miami Heat’s superteam with LeBron, DWade, and Chris Bosh?

Do you remember how that was must-watch TV and must-see events when they came to town?

You hate them, but you can’t keep your eyes off of them.

The same thing applies to tickets and pricing.

If a broker charges you a high price, OMG I got in!

If you charge that same price, OMG these greedy promoters.

It isn’t fair, but it does happen.

Flip it around and think about discounting again, do you know where Apple moves products at a discount: Best Buy, Wal-Mart, and other certified partners.


It isn’t because Apple doesn’t discount.

It is because Apple doesn’t discount directly.

Apple understands that creating a premium brand means that you have to be really cognizant of your brand story. Again, the science of marketing will show you through fMRI studies that discounts light up a specific part of the brain and that if your brand is associated with discounting, no matter what you do…people think you are going to discount soon.

Back to my theory of ticket buying: the inverse applies.

If you charge a discount, that’s awful. I’m never paying full price again.

If I get a cheap ticket on the secondary market, WINNING!

The caveat being, if your entire inventory is scraping the bottom of the barrel on the secondary market…that’s a bigger issue and you really need to go Code Red ASAP.

The big key here is that if you have the right secondary market partner, you can allow them to take actions that might be destructive to your brand.

You can move distressed inventory to the secondary market and dynamically price.

You can dynamically price upwards if you want.

You can create special offers or opportunities that you might not have the capacity to do normally.

The secondary due to the technology, the data, and the headstart in digital marketing can enable you to get creative.

This is really just a jumping off point.

While I know that there are many horror stories of working with the secondary market, if you pick the right partners…you can create an opportunity for both sides of the ticket market.

But picking the right partner starts with understanding how you can use the secondary to your advantage.